CPM promises to reverse reforms if voted to power

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The Communist Party of India (Marxist) has pledged to reverse deregulation of oil pricing, slap higher taxes on luxury goods, ban futures in agricommodities and raise taxes on the rich and big companies if it is voted to power in the April-May elections.

The party plans to mobilise resources to drive growth by taxing speculative capital gains, which would mean restoring the long-term capital gains tax and increasing the securities transaction tax.

The party’s election manifesto for the Lok Sabha elections — the first from any national party — blamed the UPA government’s misrule for high food price inflation and lack of job growth.

“The most striking failure of the UPA government was its inability to check the unrelenting and persistently double-digit food price inflation in the past seven years,” CPI(M) said.

Party general secretary Prakash Karat identified rising joblessness as the second biggest failure of the UPA government between 2005-10.

CPI-M general secretary, Prakash Karat said curbing price rise and creating jobs would be his party’s main focus areas and that CMI(M) planned to bring in a new food security law that would universalise public distribution system, excluding only the income-tax payers from its ambit.

CPI-M general secretary said the country needed alternative policies in the realms of economy and politics and CPI(M) and other left parties had set out to provide those alternatives, as highlighted in the manifesto. The alternative economic model includes integrating growth with employment generation to ensure full employment and more money in the hands of people to boost demand.

The party plans to enlarge the revenue base by taxing the rich and corporate profits, and by cracking down on tax evasion, money laundering and black money holders. The manifesto talks of a drive to unearth black money, especially those stashed in the Swiss banks and other offshore tax havens, and promises to plug various loopholes by reviewing double taxation avoidance treaties, including the one with Mauritius.

The party favours the implementation of indirect tax reforms through GST, but will implement it only after ensuring a higher share of taxes for the states “to at least partially correct the present fiscal imbalance.”

CPI(M) also proposes to scrap the fiscal responsibility and budget management (FRBM) act, aimed at phased reduction of fiscal deficit to 3 per cent of GDP and achieving a minimum floor for social sector spending as a binding constraint in the fiscal exercise for both the centre and states.

The party opposes moves for full capital account convertibility, plans to ban participatory notes used by FIIs and would discourage speculative finance.

It also proposes to prevent takeover of Indian lenders by foreign banks and privatisation of pension funds, and to cap foreign direct investment (FDI) in insurance at 26 per cent. The manifesto said the party would increase public investment in agriculture and raise plan expenditure to 10 per cent of GDP.

Besides increasing public investment in infrastructure, there would be measures to prevent big businesses from transferring risks of their projects to banks. It proposes severe action against loan defaulters.

If voted to power, the party would completely halt disinvestment and privatisation of profit-making and potentially viable public enterprises, strengthen the manufacturing sector, ban foreign direct investment (FDI) in multi-brand retail and reverse FDI guidelines to prevent what it called backdoor entry.

The party plans to link incentives for the private sector to job creation and R&D efforts.


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